AN EVALUATION OF PROCESS-ORIENTED SUPPLY CHAIN MANAGEMENT FRAMEWORKS

Journal of Business Logistics, 2005 by Lambert, Douglas M, Garc�a-Dastugue, Sebasti�n J, Croxton, Keely L

Scope

The scope of a supply chain management framework refers to the extent to which it supports the achievement of the corporate strategy, which determines the company's direction. Research suggests that in most environments, strategy has a major impact on corporate performance (Lenz 1981 ). Therefore, it is important that the firm's resources are aligned to achieve the strategic objectives. To implement strategy at the business level, organizations must integrate the functions of several different organizational areas (Barney and Griffin 1992). Furthermore, improved performance is achieved by focusing all functional activities on the market (Day 1999). Synergy should be sought across product markets and across functional departments in the business (Walker, Boyd, and Larr�ch� 1996). In order to align all functional activities to the corporate strategy, management needs to generate organization-wide market intelligence, disseminate it, and make the organization responsive to the market intelligence (Jaworski and Kohli 1993). The supply chain management framework should help align the resources so that the entire supply chain can be responsive to market intelligence.

The strategy which is used to set the objectives for the implementation of supply chain management provides an indication of the type of issues that will be addressed with the framework. The breadth of activities included in the framework is an indication of the resources that will be used to fulfill the strategic objectives. Therefore, the scope of a framework is determined by the corporate strategy or functional strategies that provide the direction for implementing supply chain management, and the breadth of the activities included.

Intra-company Connectedness

Intra-company connectedness "refers to the degree of formal and informal direct contact among employees across departments" (Jaworski and Kohli 1993, p. 56). There is agreement that corporate functions need to be connected (Kahn and Mentzer 1998; Krohmer, Homburg, and Workman 2002; Walker, Boyd, and Larr�ch� 1996). The management of inter-departmental connectedness, across corporate functions, is necessary for the successful implementation of business processes (Day 1997; Gunasekaran and Nath 1997) and this is the case regardless of whether it is focused on transactional efficiency or relationship management. For transaction oriented business processes, inter-departmental connectivity is needed to ensure that transactions flow seamlessly through the corporate functions. Without this connectivity, managers might face delayed transactions and/or bottlenecks. In the case of business processes focused on structuring inter-firm relationships, inter-departmental connectedness is required to establish relationships between firms at multiple levels within each organization. The closer the relationship, the more corporate functions will be actively involved in the inter-firm relationship (Lambert, Emmelhainz, and Gardner 1996).

Kahn and Mentzer (1998) differentiate between cross-functional interaction and integration. Cross-functional interaction refers to information dissemination (sharing), to increase information flow among corporate functions in an interactive process through, for example, meetings and written reports. Cross-functional integration includes functional interaction but also incorporates interdepartmental collaboration, which is characterized by shared goals, mutual respect, and cross-functional teams.